Slide 1: Sasol Limited Financial Results for the year ended 30 June 2018
SASOL LIMITED FINANCIAL RESULTS for the year ended 30 June 2018 August 2018
Slide 2: Forward-looking statements
Introduction Forward-looking Sasol may, in this document, make certain statements that are not historical facts that relate to analyses and other information which are based statements on forecasts of future results and estimates of amounts not yet determinable. These statements may also relate to o
Slide 3: Introduction
INTRODUCTION Bongani Nqwababa and Stephen Cornell August 2018
Slide 4: What you will hear today
Key messages What you will hear today Resilient set of results in a volatile Rand environment Robust asset management strategy confirmed, notwithstanding isolated operational challenges LCCP on track with steam utility system commissioned and production units to follow Continuing our focus on sustai
Slide 5: Resilient set of results in a volatile Rand environment
Key messages Resilient set of • Oil price ▲28% to US$64/bbl, partially off-set by exchange rate ▼6% to R12,85/US$1 results in a • EBITDA ▲10% to R52bn volatile Rand • Core HEPS ▼6% to R36,03, HEPS ▼22% to R27,44 environment FINANCIAL FINANCIAL RESULTS RESULTS • Normalised cash fixed costs remained f
Slide 6: Robust asset management strategy
Key messages Robust asset • SA Operations constrained by several unplanned Eskom supply interruptions management • Identified ways to significantly upgrade interface reliability strategy • Redundancy brought into system to improve asset maintenance • Project underway to limit interruptions by creati
Slide 7: LCCP on track
Key messages LCCP on track • Cost and schedule still on track • Overall project 88% complete with construction at 68% • $9,8bn spent of $11,13bn project cost • Commissioning activities underway with several systems and machinery being tested • Steam utility system commissioned earlier than planned •
Slide 8: Maintaining our focus on sustainable value creation: Environment
Key messages Environment Maintaining our focus on • Management’s approach to environmental sustainability includes: sustainable value • Significant investment in reducing our environmental footprint creation • Transparent and collaborative approach to ensure environmental compliance • Achieved a cum
Slide 9: Focus on social development and good governance
Key messages Focus on social Social development and • Commitment to YES1 programme launched by the SA President good governance • Successful implementation of our R22bn Sasol Khanyisa Black ownership transaction • SA workforce comprises 69% Black employees who in turn comprise 58% of junior to top m
Slide 10: Progressing with our strategy
Key messages Progressing with CHEMICALS TARGETS TO our strategy • Deliver value by optimising and leveraging existing chemicals assets MEASURE • Focusing on growth in high-value specialty chemicals in differentiated markets STRATEGIC UPSTREAM DELIVERY • Explore, develop and produce gas in Southern A
Slide 11: Progressing with our strategy: aspirational culture
Key messages Progressing with CHEMICALS our strategy • Deliver value by optimising and leveraging existing chemicals assets TARGETS TO • Focusing on growth in high-value specialty chemicals in differentiated markets MEASURE STRATEGIC UPSTREAM Driving our aspirational culture as we execute our DELIVE
Slide 12: Progressing with our strategy: chemicals
Key messages Progressing with CHEMICALS our strategy • Deliver value by optimising and leveraging existing chemicals assets TARGETS TO • Focusing on growth in high-value specialty chemicals in differentiated markets MEASURE STRATEGIC UPSTREAM DELIVERY Analysing • Explore, develop growth and produce
Slide 13: Progressing with our strategy: upstream
Key messages Progressing with CHEMICALS our strategy • Deliver value by optimising and leveraging existing chemicals assets TARGETS TO • Focusing on growth in high-value specialty chemicals in differentiated markets MEASURE STRATEGIC UPSTREAM DELIVERY • Explore, develop and produce gas in Southern A
Slide 14: Progressing with our strategy: energy
Key messages Progressing with CHEMICALS our strategy Focus on growing our share of the liquid fuels retail market • Deliver value by optimising and leveraging existing chemicals assets TARGETS TO in South Africa • Focusing on growth in high-value specialty chemicals in differentiated markets MEASURE
Slide 15: Progressing with our strategy: asset portfolio review
Key messages Progressing with Asset portfolioCHEMICALS review Business enhancement our strategy • Asset review• Deliver process underpinned value by and by optimising drive to improve leveraging • existing chemicalsContinued assets TARGETS TO competitiveness at a $40/bbl oil price asset performance
Slide 16: Financial and Operational Performance
FINANCIAL AND OPERATIONAL PERFORMANCE Paul Victor August 2018
Slide 17: What you will hear today
Financial and operational performance What you will hear today Stellar H2FY18 cost performance and higher R/bbl drives resilient financial results Stronger Rand outlook affects Base Chemicals business resulting in Chlor Vinyls impairment Effective balance sheet management supports investment grade c
Slide 18: Macroeconomic environment
Macroeconomic environment Stronger crude oil prices supports higher product prices Currency volatility remains Volatility in a US$1 = ZAR $/mmbtu (gas price) US$/bbl growing global economy $78 R13,61 $64 $64 R12,85 $50 R13,06 R13,73 $2,95 $3,00 FY17 FY18 FY17 FY18 Brent Product price Henry Hub Avera
Slide 19: Strong underlying cash performance
Group profitability EBIT (%) by product FY17 FY18 %∆ Strong Mining 3 725 5 244 41▲ underlying cash Exploration and Production International (EPI) 585 (3 683) >100▼ 19 performance Performance Chemicals (PC) 8 763 8 183 7▼ 31 Mainly: Chemicals Base Chemicals (BC) 6 862 588 91▼ Energy Energy 11 218 14
Slide 20: Operating profit impacted by remeasurement items
Operating profit Operating profit TAILWINDS impacted by FY17 31 705 • Resilient underlying cash performance remeasurement • Strong market demand and resilient US$ margins in chemical businesses items and Exchange rate (7%) Macro • Higher crude oil and product prices Khanyisa SBP environ- Crude oil a
Slide 21: Normalised cash fixed costs remained flat in real terms
Cash fixed costs Normalised cash TAILWINDS FY17 FY17 46 510 fixed costs • Stellar performance in H2 despite further unplanned production interruptions remained flat in US growth • Realised R3,5bn sustainable annual cash US growth real terms (LCCP & Gemini) (LCCP & Gemini) (1,1%) cost savings under R
Slide 22: Mining and EPI OBUs
Mining and EPI OBUs Improved safety 36,0 37,2 8,0 298 284 MINING and operational 6,7 • EBIT up 41% due to strike in prior period performance in mm tons mm tons R/ton • Management interventions significantly H2FY18 improved safety performance in Q4 • Increased volumes and prices in export business FY
Slide 23: Performance and Base Chemicals SBUs
Performance and Base Chemicals SBUs 15 9 798 3 233 3 257 PERFORMANCE CHEMICALS Product demand 12 8 257 and US$ margins • Eurasian operations production up 3% • Sales volumes 1 up 1% due to robust Rm remain strong % kt market demand • US$ margins remain resilient • FTWEP – improved stability and ~25%
Slide 24: Energy SBU
Energy SBU 32,5 31,5 ENERGY Cash fixed cost 60,0 58,7 397 399 contained to 2% • Normalised EBIT up 12% to R15,1bn number mmbbl mmbbl • Petrol differential 1% higher, diesel in nominal terms differential 21% higher • Synfuels Operations down 3% - Q4 run-rate supports long-run guidance of 7,8mt FY17 F
Slide 25: Capital expenditure
Capital expenditure LCCP optimised spend on track Capital expenditure guidance 60 • Capital expenditure within FY18 guidance 53 • LCCP spend of $2,3bn 4 • Gemini HDPE successfully reached 38 beneficial operation in November 2017 40 • Key focus on execution of strategic Rand billion 4 30 30 projects
Slide 26: FY19 Outlook: A defining FY19
FY19 Outlook A defining FY19 • Focus on safety and stability of mining operations as productivity increases UPSTREAM • PPA gas production 114–118 bscf PERFORMANCE • Sales volumes (excluding LCCP) 2-4% higher than FY18 CHEMICALS • Start-up of ethoxylation plant in China in second half of 2019 BASE •
Slide 27: Compelling investment case
Outlook Compelling OUR INVESTMENT CASE... ...anchored by… …TRANSLATES TO investment case Earnings and • Targets aligned with shareholder value • Robust foundation business geographic diversification creation • Low cost feedstock • >12% ROIC in US$ terms • Integrated and diversified value • >5% EBIT
Slide 28: Questions and Answers
QUESTIONS AND ANSWERS August 2018